Want to talk to an expert employment law solicitor?

You'll receive a callback from a specialist within an hour

In this article Chris Hadrill, a specialist employment solicitor at Redmans, explores what settlement agreements are and gives some tips on what you should do if you have been offered one

What are settlement agreements? A quick guide

An employee has the right to bring certain claims against their employer, whether such claims can be brought under statute (for example, unfair dismissal or discrimination claims), contract (for example, a failure to pay a bonus), or tort (for example, negligence claims). Such claims may arise on the employee’s recruitment, during the course of their employment, or upon termination. In certain circumstances an employer may wish to agree to provide the employee with benefits (e.g. a payment of compensation, a reference, sometimes an apology) in return for the employee’s agreement that they will waive their right to bring such claims, or withdraw them if they have already issued a claim. This may happen where employment is continuing, but it is most common for the parties to do so where employment has terminated (or is about to do so).

Employees can only agree to settle or waive most statutory claims by one of the following means:

  • If an agreement is reached through ACAS (and recorded in a COT3 agreement); or
  • If such agreement is recorded in a settlement agreement that complies with various statutory requirements (for example, the agreement must be in writing and the employee must receive independent legal advice on the terms and effect of the agreement)

Only certain statutory claims may be settled by a settlement agreement including, among others:

  • Claims for unfair dismissal;
  • Claims for a statutory redundancy payment;
  • Claims for discrimination, harassment, victimisation or detriment;
  • Claims for detriment or dismissal because the employee has ‘blown the whistle’;
  • Claims in relation to the national minimum wage;
  • Claims in relation to unlawful deduction of wages

Until July 2013 statutory agreements of this nature were renamed from “compromise agreements” to “settlement agreements”, although it is not clear why this change was made.

What should you do if you have been offered a settlement agreement?

If you’ve been offered a settlement agreement by your employer then one of the first things that you should normally do is fine a suitable specialist employment solicitor to advise you on your agreement: your employer will normally cover an agreed level of legal fees for the advice and you must receive legal advice from an independent legal adviser on the terms and effect of the agreement for the settlement agreement to be binding. However, it is up to you to choose how much or how little work you want your solicitor to do: most employees will, in my experience, want their solicitor to handle the negotiations on the agreement as well as the advice, but in some circumstances the employee may be best-placed to negotiate the terms of the agreement themselves (for example if they have a good existing relationship with senior management handling the negotiations or if they wish to keep the costs of the negotiation as low as possible).

Why should you choose Redmans to advise you on your settlement agreement?

Redmans have advised thousands of clients on their settlement agreements, and our specialist employment solicitors have dealt with agreements worth £1,000 to settlement agreements worth over £1 million.

If you want to discuss your settlement agreement further please contact our enquiries team by telephone on 020 3397 3601 or email Redmans using the following email address: enquiries@redmans.co.uk.

About Chris Hadrill

Chris is a specialist employment lawyer at Redmans. He specialises in contentious and non-contentious employment matters, including breach of contract claims, compromise agreements and Employment Tribunal cases. He writes on employment law matters on a variety of websites, including Direct 2 Lawyers, Lawontheweb.co.uk, LegalVoice, the Justice Gap and his own blog. Contact Chris by emailing him at chadrill@redmans.co.uk

Tagged with →  

Want to talk to an expert employment law solicitor?

You'll receive a callback from a specialist within an hour

Share →

Our awards

Request a callback

    Your first name (required)

    Your last name (required)

    Your email (required)

    Your telephone number (required)

    Brief details of your enquiry

    Contact us

    Please feel free to discuss your own position and concerns. Contact your nearest office on:

    T: 020 3397 3603
    E: enquiries@redmans.co.uk
    W: www.redmans.co.uk

    Testimonials

    4.78 Average

    261 Reviews

    Karen T

    Great service. Thank you.

    Posted 1 day ago

    Anonymous

    Excellent service from Chris & Mel Chin. The best outcome was achieved from the redundancy process. They were extremely thorough, listened carefully and acted swiftly on my behalf. I highly recommend Redmans Solicitors

    Posted 2 days ago

    Shanine M

    Excellent service, thank you so much!

    Posted 3 days ago

    Anonymous

    I found Caroline and Chris very Helpful and provided excellent service. Caroline especially provided great legal advice and made me feel at ease with the whole process. I would highly recommend them. Thank you!

    Posted 3 days ago

    Gayle B

    Excellent company very professional would definitely recommend

    Posted 5 days ago

    Alex K

    Redmans provided an excellent service, timely and effective. Will definitely recommend.

    Posted 5 days ago

    Anonymous

    Great job done on my employment law

    Posted 5 days ago

    Dominica S

    Caroline & Chris were very prompt and efficient.Very happy with the service and will definitely recommend Redmans Solicitor to everyone !

    Posted 6 days ago

    Sandra K

    If you are looking for a group of solicitors who are Professional, Caring and on point, then look no futher than Redmans. I was literally hand held through out my case. Can not find fault with this company, very happy with the result and the service i received. Would highly recommend Redmans.

    Posted 6 days ago

    Anonymous

    I found dealing with Redmans a pleasure. I got to speak to someone quickly, the advice was profferred promplty and the service was not 'pushy'. In addition, the administration was excellent. What more could you ask for?

    Posted 6 days ago

    ALISDAIR L

    Redmans did a brilliant job regarding my redundancy agreement. I miss read an extra charge which wasnt the case so doing a new review to clarify. I would recommend Redmans for any employment law issues you may have.

    Posted 1 week ago

    Christos G

    Great legal advice and quick correspondence. Very supportive and helpful through the entire process. Thank you Redmans!

    Posted 1 week ago

    Anonymous

    Chris Hadrill advised me on a redundancy settlement agreement. He was very responsive, easy to deal with and gave me good advice at a stressful time.

    Posted 1 week ago

    Zara M

    Rana at Redmans gave me support and confidence I needed to ensure a wrong, was put right. I couldn’t recommend enough.

    Posted 1 week ago

    Stuart T

    Chris provided an excellent service, he was efficient and friendly and I had no doubt when recommending him to my colleagues

    Posted 1 week ago

    Anonymous

    Excellent service, prompt responses. Chris Hadrill provided excellent and efficient service.

    Posted 1 week ago

    Jane M

    Wonderful solicitors who really listen to you and who are there to offer expert legal advice but they also have a personal touch and you really feel supported both from a legal aspect but also from a personal aspect. They really listen .

    Posted 2 weeks ago

    Anonymous

    They dealt with my case professional and swiftly. The advise was helpful and enabled me to make the right decisions in my case.

    Posted 2 weeks ago

    Anonymous

    I have received a great legal advice from Redmans on a very short notice. I’d highly recommend them.

    Posted 2 weeks ago

    Michael D

    Excellent, efficient advice - the whole matter was concluded with minimum fuss and an excellent outcome.

    Posted 2 weeks ago

    Michael Q

    I found Redmans via the internet. I was looking for a solicitor with employment law experience and they fitted the bill. I was very pleased with the advice/service that I received leading to a good outcome for me.

    Posted 2 weeks ago